Markets pare some gains as European indices make a flat start

Domestic equity markets have came off their highs in the mid noon session after the flat to soft start of the European markets, though there was some recovery attempt and which limited the downfall but traders are still taking cautious approach. Some of the major European indices made a down start by about half a percent, as concern over the future of the euro overshadowed China’s pledge to boost growth. German Finance Minister Wolfgang Schaeuble will be discussing the euro for the first time at a meeting with his newly installed French counterpart, Pierre Moscovici, in Berlin today. Back home, though the rate sensitive sectors have strengthened further but the IT and technology stocks continue to bleed. There is some buzz in the whole media pack after Aditya Birla Group, during the weekend agreed to make a financial investment of 27.5% in Living Media India, part of India Today Group, through its private investment company. TV Today Network has touched its upper circuit limit, trading higher by 20%, NDTV too has touched the roof and was up by 10%, Reliance Broadcast Network was up by 2.83% and Entertainment Network was up by 1.76%.

The BSE Sensex is currently trading at 16,215.54, up by 62.79 points or 0.39%. The index has touched a high and low of 16,286.14 and 16,172.05 respectively. There were 19 stocks advancing against 11 declining ones on the index.

The broader markets too have given up some of their gains; the BSE Mid cap and Small cap indices were up by 0.51% and 0.93% respectively.

The top gaining sectoral indices on the BSE were CG up by 1.43%, Realty up by 1.37%, Bankex up by 1.36%, Power up by 0.95% and Oil & Gas was up by 0.61%.

On the flip side, IT down by 0.60%, FMCG down by 0.55% and TECk down by 0.30% were the only losers on the BSE sectoral front.

The top gainers on the Sensex were, Tata Power up by 3.45%, SBI up by 3.43%, Maruti Suzuki up by 3.02%, DLF up by 1.83%, L&T up by 1.66%.

On the flip side, Bajaj Auto down by 1.76%, NTPC up by 1.51%, Tata Steel down by 1.23%, Wipro down by 1.23% and Infosys down by 1.12% were the top losers on the Sensex.

Meanwhile, falling international prices of iron ore and coking coal are expected to increase profit margins for domestic steel manufacturers by 3% in this financial year. However, it is expected that the margins will be difficult to sustain given the depreciating rupee and unlikely scenario of the raw materials maintaining their low prices.

The price of coking coal has witnessed a recent fall due to increase in supply from Australia, the biggest producer of the commodity. Currently the price of coking coal stands at $215 a tonne as compared to the earlier high of $350 a tonne. Further iron ore prices have also slipped due to a slowdown in demand from China, which is its biggest producer as well consumer.

Despite the fall in raw materials, steel prices in India have maintained their current levels for the past few months due to the depreciating rupee. It is in fact expected that steel prices may inch up further when the rupee appreciates. Currently the price of domestic steel is around Rs 32,000 per tonne.

The S&P CNX Nifty is currently trading at 4,912.35, up by 20.90 points or 0.43%. The index has touched a high and low of 4,933.35 and 4,888.50 respectively. There were 32 stocks advancing against 18 declining ones on the index.

The top gainers of the Nifty were Tata Power up by 4.46%, Reliance Infra up by 3.97%, SBI up by 3.66%, Maruti Suzuki was up by 3.02% and BoB was up by 2.83%.

On the flip side, NTPC down by 1.69%, Bajaj Auto down by 1.62%, Tata Steel down by 1.55%, Wipro down by 1.47% and ACC down by 1.44% were the major losers on the index.

The Asian counters were trading mixed in the last leg of trade; Shanghai Composite gained 0.16%, KLSE Composite was up by 0.20%, Nikkei 225 added 0.26%, KOSPI Composite was up by 0.94%, Taiwan Weighted was trading higher by 0.57% and Straits Times has added 0.04%.

On the other hand, Hang Seng was down by 0.20% and Jakarta Composite lost 1.42%.